Question 10. What are the nature or Characteristics of Management Accounting?
Answer 10. 1. BOTH AS A SCIENCE AND AN ART - In management accounting data are collected systematically and they are analysed with the help of various formulae and techniques and on this basis it is a science . On the other hand , subjective judgement of management and various needs of the organisation are also taken into account while taking decision and on this basis it is an art.
2. ACCOUNTING SERVICES - Management accounting is a function of accounting services towards management. Under this service necessary informations are provided to various levels of management. These information may be financial as well as non- financial.
3. Integrated system - Management accounting us an integrated system in which technique related to various subjects are used in the process of data collection , analysis and decision -making.
4. More concerned with future - Management accounting is more concerned with 'future' . No doubt, analysis and interpretation are made on the basis of historical data, but the important objective of management accounting is to determine policies for future, to make forecasting and to help management in its task of planning and budgeting.
5. Achieving of objective - In Management accounting , the accounting information is used in such a way so that organisational objectives and targets may be achieved and efficiency of business may be improved.